We use a statistical model to estimate the expected collection rate for each Consumer Loan at the time of assignment. We continue to evaluate the expected collection rate of each Consumer Loan subsequent to assignment. Our evaluation becomes more accurate as the Consumer Loans age, as we use actual performance data in our forecast. By comparing our current expected collection rate for each Consumer Loan with the rate we projected at the time of assignment, we are able to assess the accuracy of our initial forecast. The following table compares our forecast of Consumer Loan collection rates as of December 31, 2012, with the forecasts as of September 30, 2012, as of December 31, 2011, and at the time of assignment, segmented by year of assignment:
|Forecasted Collection Percentage as of||Variance in Forecasted Collection Percentage from|
|Consumer Loan Assignment Year||December 31, 2012||September 30, 2012||December 31, 2011||Initial Forecast||September 30, 2012||December 31, 2011||Initial Forecast|
(1) The forecasted collection rate for 2012 Consumer Loans as of December 31, 2012 includes both Consumer Loans that were in our portfolio as of September 30, 2012 and Consumer Loans assigned during the most recent quarter. The following table provides forecasted collection rates for each of these segments:
|Forecasted Collection Percentage as of|
|2012 Consumer Loan Assignment Period||December 31, 2012||September 30, 2012||Variance|
|January 1, 2012 through September 30, 2012||72.3||%||71.6||%||0.7||%|
|October 1, 2012 through December 31, 2012||71.8||%||--||--|
Consumer Loans assigned in 2003 and 2009 through 2011 have yielded forecasted collection results materially better than our initial estimates, while Consumer Loans assigned in 2006 and 2007 have yielded forecasted collection results materially worse than our initial estimates. For all other assignment years presented, actual results have been very close to our initial estimates. For the three months ended December 31, 2012, forecasted collection rates improved for Consumer Loans assigned in 2011 and 2012 and were generally consistent with expectations at the start of the period for all assignment years presented. For the year ended December 31, 2012, forecasted collection rates improved for Consumer Loans assigned during 2008 and 2010 through 2012 and were generally consistent with expectations at the start of the period for all other assignment years presented.
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